Interest Rate Lock-Ins and Refinancing a Home Mortgage

You have decided that you want to refinance your home mortgage. The next question is should you lock in the interest rate or not? Timing is of the essence when it comes to refinancing a home loan so always bear this in mind.

Refinance interest rates are at the whim of the economy so trying to guess what will happen next is a guessing game that many do not want to play at. The timing of when you should lock in an interest rate on a refinance home mortgage is not necessarily going to fit the ideal situation.

You can improve your odds of choosing the right time to refinance a home mortgage and lock in the best rate possible by taking an honest assessment of where you are financially. You then need to view the current trend when it comes to interest rates and then proceed to lock in a refinance interest rate that feels comfortable to you.

Waiting for the right time to lock in a refinance mortgage can keep it in a type of suspended state for a period of time. If you lock in the refinance mortgage in a hasty manner or if you do it for a long span of time, such as 60 days or more this can mean that you will end up paying a higher refinance interest rate.

The date of the closing on the refinance mortgage is important when it comes to locking in your mortgage. If it is your plan to close on refinancing a 2nd mortgage before 30 days  are up then locking in the rate for 45 days should work well for you. This provides you with a little leeway if anything unforeseen happens such as a delay in the closing date or an emergency that takes you out of town.

One thing you might want to do is to lock in a selection of refinance interest rates for different spans of times with a variety of refinance lenders. The disadvantage to doing this is that you will have to pay application fees and some may be refundable while others may not. This method can become very expensive.